Moody's cuts Energy XXI's PDR to Ca

Moody's Investors Service said it affirmed Energy XXI Gulf Coast, Inc.'s Caa3 corporate family rating, downgraded its probability-of-default rating to Ca from Caa3 and affirmed the Ca rating on its senior notes due 2013.

The outlook remains negative.

The agency said the rating actions reflect Energy XXI's recently announced bond exchange offer for its notes under which holders are being offered new second-lien notes due June 15, 2014 at a conversion price of 80 cents on the dollar.

Moody's views the offer as tantamount to a distressed exchange and would classify this transaction as a limited default when the exchange offer closes.

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